Choosing your business location is among the key factors to consider at the beginning of your journey as an entrepreneur. The site you choose will dictate crucial elements like foot traffic, ambiance, and accessibility, all of which can affect your bottom line.
Perhaps you have reached a certain level of success and are already bound to expand operations, or certain elements have changed that necessitates the need to move to a new location. Making the most out of your hard-earned capital when investing in a brand-new business site is critical to the continued success of your endeavor. The effects of location on your business’ finances are undeniable.
There is more to finding the perfect spot for your business than searching for available buildings with ample space for your everyday demands. What are some of the things you should consider when picking your business location?
Things to consider before settling on your business location
Take the time to thoroughly research and examine the area you are eyeing for your business. Before pouring in the capital for setting up a shop, you should have full awareness of how the site can affect your company’s future.
1. Consider the type of business
For instance, a central office headquarters and a physical store both have different needs. The former will be where you conduct meetings with staff, suppliers, or clients, while the latter is where you will have your offerings on display. Who are the people expected to walk into your door regularly?
Finding the most suitable place will depend on what type of business you are building. Think about it: a bookshop, a salon, a retail store, a restaurant or café, or any other enterprise has different demands and target market. Make sure you pick a locality or an area that will match the way you use your place of business.
2. Examine your potential location’s demographics
Ensure that your target market can access your location and that there will be locals in the area who can work for you. Acquiring customers and filling your workforce will go hand-in-hand to ascertain that your marketing efforts will bear fruit.
Assuming you have in-depth knowledge of your target market’s profiles, examine whether the majority of the population in the area can provide you a profitable business. When looking for prospective talents in the area, look out for the available skill sets of residents within the location.
You can get started on studying the immediate communities within, as well as the surrounding areas of your target business location.
3. Match the location to your style of business operations
Another factor to consider is the style of operation you want to achieve for your company. Maybe you are setting up a café with a laid-back vibe where people can hang out, or retail with a more mobile business like a kiosk or food cart that will not have you tied to one spot.
The way customers or potential clients perceive your business should be tied with your brand identity and image.
4. Assess foot traffic and see how it ties into your business model
That new restaurant you are planning to open shouldn’t be in a dead spot if you want a steady high volume of customers to come in and out of your establishment. But if your restaurant business model veers more on the high-end, by-reservation-type of operation that requires an air of exclusivity, maybe choosing a more remote place will work best for you.
5. Identify government-related zoning laws or ordinances, dues, fees, and incentives
Make a detailed assessment of your target area’s local or state zoning laws and the tax implications of setting up your business in that locality.
There may be tax benefits both on a state and federal level for SMEs in specific industries, so make sure you are not missing out on any of those opportunities that can apply to your business set-up.
6. Pinpoint nearby competitors and study their movement
Competitor research is one of the pillars of good business planning. The knowledge you gain from studying your competitors will give you insights into how to manage your own business.
If the competitors are not thriving in the area that you are eyeing, then maybe it is not a good idea to build your business in the same place.
If the opposite is true for your competitors and they are attracting a lot of business in that locality, it may be ideal to set up shop near them. If your competitors are doing exceptionally well, it means that you can attract customers who are looking for similar offerings in that area.
7. Assess other businesses in the area
Aside from competitor research, market research includes considering the other nearby businesses in the town or city you are planning to penetrate. Are you planning to build a trendy clothing store that caters to fashionable middle-class millennials? Perhaps there are cafes or other attractions in that area where they hang out, which ups the possibility of them wandering into your store.
Look out for businesses that you could collaborate or partner with in the area, too. Working with other local enterprises helps build a healthy business community, boosting sales for everyone and improving the local economy.
8. It is vital to consider accessibility and parking spaces available
The key players that will help your business move include your employees, your suppliers, and of course, your customers. Will they all be able to access your location without problems? Are there parking spaces available for them? Will delivery trucks, or perhaps smaller courier vehicles, be able to pop in and out of your space with ease?
Having space for such undertakings will give you the capability to accommodate whatever your business needs and allow you to operate smoothly on a day-to-day basis.
9. Evaluate the level of safety and security
Once you have done your homework surveying the town or city of your choice, assess if it is a safe area for your place of business. Studying and evaluating accident or disaster risks, as well as crime statistics, will reveal your target neighborhood’s level of safety and security.
10. Consider your target business location’s backstory and image
Your potential customers will associate your location with your business’s image. It is inevitable. Evaluating your target area or structure’s history is especially vital when targeting locals in the community.
If you are looking at small spaces or buildings, ask about the previous tenants. Your location’s history would automatically reflect the image you want to project out there, whether you like it or not.
Take your time before making a final decision
Choosing a business location is a time-consuming process that is well worth the effort. If done with care and accuracy, your location will contribute significantly to the success of your company. Make sure you take all necessary steps to ensure that you are making the best choice for your business.